Botswana to record surplus- S& P

Global economic rating agency, S& P anticipates Botswana to record budget surplus of 0.2 percent of GDP the 2023 fiscal year ( April 2022- March 2023) on increased mineral revenue supported by strong diamond prices and higher volumes.

Diamond sales represented the largest share of 43 percent of fiscal revenue in the first four months of fiscal 2023. This translated into a surplus of 1.7 percent of GDP. The agency highlighted that they expect Southern Africa Customs Union ( SACU) revenue to normalize at P14 billion to P15 billion on resumption of trade flows, while value- added tax ( VAT) income will remain resilient at P10 billion to P12 billion. Government reduced VAT rate to 12 percent from 14 percent for the six months ending January 2023 to alleviate inflationary pressures on households and reduced to zero the rate for some essential products. “We expect expenditure will increase by three percent in fiscal 2023 compared with fiscal 2022 on higher aid and grant disbursements. The government projects the development expenditure budget will increase an ambitious 40 percent, which will largely determine the extent of the budget outturn, in our opinion.”